THE HINDU (Business Line)

Southern Online plans to acquire biotech co

C.R. Sukumar

Hyderabad , March 23

SOUTHERN Online Services Ltd (SOSL), the city-based software and Internet service provider, plans to acquire the complete holding of a biotechnology company called Southern Biofe Bio Fuels (SBBF) for consideration other than cash.

According to sources close to the deal, SOSL entered into an "agreement of sale of shares" with the shareholders of SBBF in the second week of February second week for acquiring its 3,43,097 equity shares of Rs 10 each.

"The move is aimed at enabling SOSL to implement its plans to diversify into other areas of activities such as biotechnology, biodiesel and biofuel (alternative fuel) manufacturing. Towards this, SOSL has identified SBBF, which has already carried out extensive research and market survey in the field of manufacturing of biofuels such as bio-diesel. SBBF is possessing valuable expertise and information of technical and marketing aspects," the sources said.

The German Technical Cooperation (GTZ), which promotes alternate energy sources, has appointed a consultant to carry out the financial and socio-economical appraisal of the SBBF project, they said.

Having entered into an agreement of sale of shares with the shareholders of SBBF for acquiring the entire holding, the SOSL board now proposes to allot its 3,43,097 equity shares in favour of the SBBF shareholders on a preferential allotment basis.

Further, to meet the cost of the proposed biotechnology project, the SOSL board has also decided to issue and allot 62,96,603 equity shares of Rs 10 each aggregating Rs 6.29 crore with or without premium to the public or other persons/bodies as may be decided at a later stage.

In view of the change in business, the SOSL board has decided to change the name of the company as Southern Online Bio Technologies Ltd. The Registrar of Companies (RoC) at Hyderabad has confirmed that the new name is available for registration, the sources said.